Reports that Starbucks Corp. (SBUX) is exploring a potential acquisition of Chipotle Mexican Grill (CMG) have drawn attention to the restaurant sector and the exchange-traded funds that hold these companies. According to the Financial Times, Starbucks is in discussions with advisers regarding a deal that would combine the two brands, creating a company with approximately $50 billion in annual sales.
Following the report, Chipotle’s stock jumped about 6%, while Starbucks shares fell roughly 3%. The news has prompted speculation that a broader wave of restaurant consolidation could follow, making diversified ETFs a potential way to track the industry's performance.
With the AdvisorShares Restaurant ETF having closed in May, investors are turning to broader consumer and leisure funds for exposure. The Vanguard Consumer Discretionary ETF (VCR) is highlighted as a primary vehicle, holding roughly 10% of its portfolio in restaurant-related stocks. Specific holdings include McDonald’s Corp. (MCD) at 2.9%, Starbucks at 1.8%, Chipotle at 0.8%, and Yum! Brands Inc. (YUM) at 0.7%. The fund manages $6.6 billion in assets and charges an expense ratio of 0.09%.
The Consumer Discretionary Select Sector SPDR Fund (XLY) offers a different approach, with Starbucks comprising 2.97% of its portfolio and McDonald’s at 4.20%. It also holds DoorDash Inc. (DASH) at 1.96%. For investors seeking more concentrated restaurant exposure, the Invesco Leisure and Entertainment ETF (PEJ) allocates 59.3% to hotels, restaurants, and leisure. Starbucks is its largest holding at 5.2%, followed by The Cheesecake Factory Inc. (CAKE), Restaurant Brands International Inc. (QSR), and BJ’s Wholesale Club Holdings Inc. (BJ).
Additional exposure can be found in the Fidelity MSCI Consumer Discretionary Index ETF (FDIS), which holds Starbucks at 1.77% and Chipotle at 0.72%. The First Trust Nasdaq Food & Beverage ETF (FTXG) also provides exposure to Starbucks and restaurant-related companies such as Restaurant Brands International and BJ’s Restaurants.
